Rare Meeting During Fed's Quiet Period Sparks Controversy Over Bowman and Powell's Schedules

The Federal Reserve's public schedule shows that Michelle Bowman and Jerome Powell attended banking-related events a week before the FOMC meeting. It is reported that these events did not discuss monetary policy, but the revelation coincides with renewed pressure from Trump on the Fed.

Written by: Wu Yu, Jinshi Data

The latest public schedule records from the Federal Reserve indicate that two Fed governors met with banking industry representatives or participated in related activities during the "quiet period" before and after the Federal Open Market Committee (FOMC) meetings in May and June this year. Although there is currently no evidence that they violated the Fed's communication rules, these contacts are relatively uncommon in terms of timing.

The schedule of Michelle Bowman, the Fed's vice chair for supervision, shows that she met with the head of the Massachusetts Bankers Association a week before the FOMC meeting on June 16-17. A Fed spokesperson stated that the meeting was to prepare for her public speech at the association a week after the FOMC meeting.

Former Fed Chair Jerome Powell attended a reception hosted by the Global Board of Bank of New York Mellon on June 9, also a week before the FOMC meeting. A Fed spokesperson said Powell attended as an invited guest and did not speak at the event.

These schedule records were requested by Bloomberg in July, and the central bank released them last Friday evening.

According to regulations, Fed officials are prohibited from publicly discussing their views on the economy or monetary policy about a week and a half before the FOMC meeting and the day after the meeting ends. Even outside the quiet period, officials are not allowed to disclose relevant views in non-public settings unless they are merely repeating previously published content.

The exposure of these schedules comes at a time when Trump is renewing pressure on the Fed.

After Kevin Warsh took over as Fed Chair from Powell this year, Trump had reduced his public pressure on the Fed. However, his latest moves indicate that pressure is resurfacing. Meanwhile, Trump's approval ratings have noticeably declined ahead of the midterm elections in November, with polls showing voters dissatisfied with his handling of living costs and the Iran war.

In August, U.S. non-farm payrolls unexpectedly increased by 162,000, and the unemployment rate remained stable. Investors subsequently raised their bets on a rate hike at the Fed's next meeting, leading to declines in U.S. stocks and short-term Treasury prices.

Trump later expressed dissatisfaction with the market decline. He stated that the strong employment data, along with good credit and economic conditions, should have led to a rise in the stock market, but it fell due to inflation concerns.

Trump's statements were even more aggressive than those of White House Chief Economic Advisor Kevin Hassett. Hassett stated that the strong employment data strengthened the case for maintaining current interest rates and said, "We respect the Fed's independence, but I think the reasons for keeping rates unchanged are quite sufficient."

Bowman's Previous Private Dinner Also Sparked Calls for Investigation

Bowman has previously drawn attention for attending a private dinner during the quiet period.

Media outlets, including Bloomberg, reported that Bowman attended a private dinner hosted by Bank of America in New York just hours after the FOMC meeting in June. Bowman later stated that she did not discuss monetary policy positions at the dinner and claimed she had "always complied with all applicable FOMC regulations and ethical standards" and would continue to do so.

The dinner subsequently prompted Senator Elizabeth Warren to call for an investigation by the Fed's Office of Inspector General.

Bowman's schedule for June 17 also shows that she met with Tennessee Republican Senator Bill Hagerty about an hour after the FOMC meeting ended, before the interest rate decision was publicly announced. Fed officials can communicate with government officials during the quiet period, including discussing non-public information, but they are not allowed to disclose confidential FOMC information without written authorization from the chair.

While it is not a violation for Fed officials to engage with external parties before and after the FOMC decision is announced, communicating with banking industry representatives or the public during this time window is not common.

Bowman's schedule also indicates that she participated in a roundtable discussion at the Colorado Forum on May 7 and attended a roundtable event hosted by the New Hampshire and Vermont Bankers Association on May 14. A Fed spokesperson stated that both events were part of regulatory feedback activities and did not discuss monetary policy.

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